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Squaring the circularity challenge for net zero

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Daphne Vlastari, Head of Public Affairs

Daphne Vlastari, Head of Public Affairs | BASF

5 min read Partner content

BASF's Head of Public Affairs, Daphne Vlastari, makes the case for a mass balance approach for more sustainable chemicals manufacturing and explains how Government support can unlock investment into the UK.

The story behind what our everyday products are made of is a vital piece of the net zero puzzle that is often overlooked. 95% of all manufactured products rely on chemicals but the majority of chemicals production is still based on the extraction of fossil fuels.

Finding alternative feedstocks for chemicals production will be a significant challenge for industry but without it we cannot truly reach net zero.

For BASF, one of the largest chemicals manufacturers in the world, addressing this challenge is a core part of our path to reaching net zero and we have been working hard to use more recycled and renewable feedstocks, shaping new material cycles and creating new business models. By the year 2030, BASF aims to double its sales generated with solutions for the circular economy to €17 billion compared to 2020. But how will these ambitious targets be met?

While significant progress has been made in identifying the enabling technological solutions, government support for these technologies will be critically important to scale up their deployment in a timely manner.

One example is chemical recycling.

Complementary to mechanical recycling, chemical recycling allows for materials that are harder to recycle to be diverted from landfill or from incineration for energy recovery and to become a valuable resource within the circular economy. At BASF, chemical recycling helps us to use feedstock from plastic waste, especially waste streams not suitable for mechanical recycling, to produce new chemicals including plastics. It allows us to deliver high-quality recycled material for a large number of applications across sectors like pharmaceuticals, food, cosmetics as well as medical devices, or certain automotive components and construction products whilst meeting strict safety, regulatory and performance standards.

With the UK aiming to eliminate all 'avoidable' plastic waste by 2042 and to work towards only recyclable, reusable or compostable plastic packaging being placed on the market by 2025, chemical recycling clearly has an important role to play.

The UK Government already supports chemical recycling – for example, in the relatively recently introduced plastics packaging tax, chemical recycling is within scope. In addition, it has also invested in advancing this technology with many such projects supported by the UKRI’s £60m five-year Smart Sustainable Plastic Packaging programme. At the same time, companies operating in the UK are also putting forward proposals for investing in plants that can chemically recycle a variety of materials.

However, for these investments to progress at pace, industry needs UK policy to support the concept of ‘mass balance’ alongside chemical recycling. Mass balance is a well-known and widely used “chain of custody” model which is already successfully deployed in other sectors, such as biofuels, fairtrade cacao and coffee. In the case of chemical recycling, mass balance is a valuable tool for replacing fossil feedstock with plastic waste-based feedstock. It is complementary to methods such as mechanical recycling and it allows for an accelerated transition to net zero because in the early phase of the transition it can work with existing technology and assets. When the feedstock from chemical recycling is fed into a largescale manufacturing complex, such as BASF’s integrated site in Ludwigshafen in Germany, it can no longer be physically separated from the virgin fossil fuel sourced feedstock. So, the mass balance methodology is required to accurately calculate and verify the amount of recycled feedstock attributed to products while continuing efforts to minimise the amount of virgin fossil fuel sourced feedstock.

The principle is similar to when consumers buy “green” or “clean” electricity. Although the consumers cannot be certain that the electricity they use has come directly from renewable sources, the overall share of green energy in the grid rises in step with demand.

A major advantage of this mass balance approach is that it reduces greenhouse gas emissions and virgin fossil feedstock inputs, while the quality and properties of a product remain the same. Since there is no need to adapt formulations, plants or processes, with mass balance our industry can move faster towards a net zero transition. Conversely, without mass balance, this transition risks being compromised. Amongst other things, it would create stranded assets as an entirely new stand-alone infrastructure for producing plastics solely from recycled waste would be needed. It would take years to construct new manufacturing plants with billions in costs and a high climate footprint.  

At a time when delivery against our climate ambitions is more important than ever before, the importance of clear government signals and policy to unlock investment cannot be underestimated.

The UK Government’s recent commitment to launch a public consultation on the use of mass balance in the context of the plastics packaging tax has already been welcomed by industry as a step in the right direction. To ensure that momentum behind this opportunity is not lost, the consultation needs to take place in 2023. What is more, given its potential for sustainable chemicals manufacturing more broadly, it will be important to consider how government policies can more clearly articulate the role of chemical recycling and mass balance. In this respect, the UK Government’s commitment to review Defra’s Resources and Waste Strategy with a focus on net zero is a unique opportunity to position the UK as a leader in this area. Companies such as BASF are keen to work together with government and parliamentarians to discuss the role different technologies could play in meeting the objectives of the 25 Year Environment Plan and nurturing new business opportunities across the country.

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